Bradley Wiggins finished second in the time trial at the world championships last year but crashed out of the Tour de France. Photograph: Denis Balibouse/Reuters

Bradley Wiggins's chances at the Tour de France and in the Olympic time trial have been improved by the banning of Alberto Contador, who will contest neither after being banned for his clenbuterol positive test in 2010. The odds on Wiggins winning the Tour were shortened after the ruling by the court of arbitration for sport to ban Contador until 5 August this year.

Contador, who had won three Tours before being stripped of his 2010 title, would have been among the favourites for the Tour and the time trial, which is among his strong suits. The Spaniard did not react initially to the verdict from the CAS but will give a press conference on Tuesday.

Contador proclaimed his innocence from the moment the test result was made public, claiming that he could have ingested clenbuterol only through eating beef that had been contaminated with the drug. The report from the three-man panel at the CAS said such a claim could not be proved; however, the theory that the clenbuterol might have been ingested through a blood or plasma transfusion was "equally unlikely".

His brother Fran, who is also his manager, said he would continue racing after the ban ends. "Things are clear for my brother," he said. "He will not quit cycling." Contador is banned until 6 August, which leaves him free to race in the Tour of Spain, which starts on 18 August.

The ruling means he is set to sit out the Tour involuntarily for the third time in his career. In 2006 he was refused permission to start the race along with other members of his team as the Operación Puerto blood doping scandal rocked cycling while two years later the organisers refused to invite him and his Astana squad following a scandal involving the team in 2007, in which Contador had played no part.

There was little joy from rival cyclists who stand to benefit immediately from the decision to strip him of the 2010 Tour title and his major victories in 2011. Andy Schleck lost the 2010 race in controversial circumstances by 39sec but said that he was "sorry" for the Spaniard and he had always believed in Contador's innocence.

Schleck will become the fourth Luxembourgeois to win the Tour, after his compatriots Charly Gaul in 1958, Nicolas Frantz in 1927 and 1928, and François Faber in 1909. Schleck was echoed by the Italian Michele Scarponi, who will be awarded victory in the 2011 Giro.

The organiser of the Tour de France, Christian Prudhomme, welcomed the verdict, having seen the 2011 race disrupted by Contador's presence as the Spaniard drew catcalls from the crowd and criticism from the media.The Spaniard's fifth place in that event will be cancelled as well as his 2010 victory. "My first reaction is to say 'at last'," said Prudhomme. "It ends an interminable process which had simply gone on too long and which was embarrassing for the organisers of all the races in which Contador had been able to take part."

After being allowed to return to racing in February 2011, Contador had also won the Tour of Murcia and Catalonia and taken stage victories in the Tour of Castille-Leon and, this year, in the Tour of San Luis in Argentina. All those results – 12 victories in all – will have to be rewritten.

The Spaniard had been provisionally suspended after the positive test, on a sample taken on the rest day of the 2010 Tour, until two initial rulings by the Spanish Cycling Federation, RFEC, at the start of February 2011. The first verdict proposed a 12-month ban due to the small quantity of clenbuterol found in his urine but that was contested and the RFEC then ruled he had no case to answer.

The ICU and Wada then appealed that verdict at the CAS, forcing their ruling of Monday that Contador should serve the usual two years for an anti-doping infraction. The ban is backdated to begin in August 2010 when Contador was first advised of the positive. The Tour organiser praised the "stubbornness" of the two bodies which appealed against the RFEC's absolution of Contador. "Today, no matter what the cost and no matter who is the person accused, those organisations will pursue those cases."

In hindsight Contador's key error looks to have been his refusal to accept the initial one-year ban suggested by the Spanish Cycling Federation's disciplinary commission. At worst, taking that would have sidelined him for a single summer. As it has turned out, by contesting the ruling he has ended up losing all of 2011 and most of 2012.

• This article was amended on 7 February 2012. The original said Schleck will become the second Luxembourgeois to win the Tour. This has been corrected.